01 August 2022

Michigan Court of Claims Stays Ruling on Michigan’s Minimum Wage and Paid Medical Leave Laws, Now To Be Effective February 2023

On Friday, July 29, 2022, the Michigan Court of Claims entered a “stay” of its July 19, 2022 ruling that the 2018 Michigan Legislature’s “adopt and amend” strategy related to two 2018 ballot petition initiatives involving the minimum wage and paid sick leave was unconstitutional.  Miller Johnson’s previous Client Alert on the Court of Claims decisions may be accessed here.

The Court granted a stay until February 19, 2023, finding that “there are justified concerns regarding the ability of employers and relevant state agencies to immediately accommodate the changes required by [the statute].” The Court noted that the length of the stay- 205 days- is equivalent to the number of days between the date the 2018 Michigan Legislature adopted the original ballot petition initiatives (September 5, 2018) and the date those laws were set to take effect (March 29, 2019).

This means that, for now, the current $9.87 per hour minimum wage and the current Paid Medical Act remain in effect; however, effective February 19, 2023, the Earned Sick Time Act will replace the Paid Medical Leave Act, and there will be significant changes to the Michigan minimum wage.  That is, of course, unless the Court’s decision is overturned altogether on appeal.

It is also possible that parts of the ruling will become moot if new legislation is passed.  For example, a separate ballot initiative supporting a $15.00 per hour minimum wage has reportedly gained the requisite number of signatures to qualify to appear on the 2024 Michigan ballot. If true and enough signatures are verified, the initiative would go to the Michigan Legislature for consideration and the Legislature could either approve the measure and it would be enacted into law, or the Legislature could pass and the initiative would go before Michigan voters.

Miller Johnson is closely monitoring developments in this case and will continue to alert clients of important information. In the meantime, employers should contact their Miller Johnson attorney to discuss the impact of this decision on their compensation and paid leave policies and practices.